What Does a Post-Brexit Construction Industry look like? « Sum




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What Does a Post-Brexit Construction Industry look like?

As we close into six months until the imminent Brexit divorce, all industries are considering what their survival and future look like in the independent UK.

The construction industry is naturally volatile, with fluctuations often responsive to economic and confidence related variables. Thes variables include the likes of interest and exchange rates, alongside influencing further economic indicators like GDP and inflation.

As the Brexit negotiations become more and more heated and uncertainty looms over the majority of industries operating in the UK, there are a number of key areas within construction where concerns are most focused. From making up for loss of skilled labourers by implementing worker drones to a decrease in movement of labour, it is absolutely critical that construction companies in the UK understand the potential restraints and changes they may face in the near future.

Shortages in product and materials

If the UK were to leave the EU without a deal this would inevitably cause a significant ripple in the trade of goods with EU countries, which would indefinitely include those materials required for construction purposes. Just over £10bn worth of construction products are important to the UK from the EU every year, this includes timber amounting to £1bn and aluminium products amounting to £750m – which make up 15% of the products used within the UK construction industry.

If a ‘no deal’ exit becomes reality, it is likely that the UK would lead back on to World Trade Organisation rules, which would see a variety of tariff and non-tariff barriers imposed at the borders. If this occurred it would allow the UK to abolish import tariffs – potentially – however this would have to occur across the board, applicable to every country that is traded with within the WTO terms.

Although tariffs could change, the more pressing concern is focussed on standards, regulations and red tape which could arise when trading with another country. Delays could arise with products needing to be more closely checked upon arriving at UK customs, forcing a subsequent delay on projects and resulting in timescales needing to be drastically adjusted accordingly.

Skills shortages

Skills gaps are quickly becoming a key concern across a variety of industries. With a significant number of EU nationals leaving the UK following the Brexit decision, sectors, including construction, have seen a considerable loss of talent due to overseas workers feeling unwelcome and uncertain.

Leaving the EU, with no deal, will result in EU nationals living and working in the UK, and vice verse, uncertain on their rights to work and reside. With EU nationals comprising around 7% of the UK construction workforce, this could result in a considerable blow to the capabilities of companies nationwide.

The industry has already begun to work alongside the government to train more UK staff in order to cope with construction demands ahead of December 2020, which marks the end of the transitional period. Skills gaps efforts should also be implemented in-house within individual companies, in order to attract, retain and train the younger generations to effectively line them up to take over once the currently ageing construction workforce retires in the near future.

New technology

Questions around skills shortages have also lead to a deeper interest from the industry in technology, primarily, robotics that can work in place of people where there are not enough workers to complete a task.

It was recently revealed that ‘armies’ of robot bricklayers could be unleashed on Brexit Britain to support construction firms and make up for the loss of skilled labourers. The construction industry has been pegged as one of the more receptive to autonomous machines and drone support, with 47% of British firms anticipating that building site robots will alter the landscape of the industry, compared to only 34% of companies globally.

With construction contractors already struggling to fill vacancies, robotics and technology could further assist the industry in keeping projects moving and could result in an increased interest in the industry from the younger generations, due to the nature of the work, such as operating and maintaining drones.

Furthermore, with robots able to lay 3,000 bricks a day, which shadows the 300-600 which can be laid by human workers, utilising this technology could support in bridging the gaps left by a mass exit of workers as well as dramatically improve productivity and output.

Finally, drones have been used to complete surveying, inspections and progress monitoring, allowing for an improved service offering from those who oversee the project from start to finish, such as quantity surveyors.

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